10/04/2010 @ 5:32PM

Now It's Officially Hostile With Sanofi And Genzyme

French pharmaceutical giant
Sanofi-Aventis
on Monday announced it has made a hostile takeover bid for biotech company
Genzyme
.

Sanofi’s tender offer, which was made directly to shareholders of Genzyme, is for $69 per common share. The total value of such a transaction is around $18.5 billion. Genzyme has until December 10, 2010, to either accept or decline the offer, as it will expire on that date.

The offer represents a 38% premium Genzyme’s July 1 closing price, but is actually lower than GENZ’s Friday closing price of $70.88. Genzyme’s shares have rocketed higher in recent months, since the initial takeover rumors began.

The Bottom Line

We removed shares of SNY from our recommended list back on Apr.27, when the stock was trading at $36.10. The company has a 4.29% dividend yield, based on Friday’s closing stock price of $33.12 The stock has technical support in the $30 price area. If the shares can firm up, we see overhead resistance around the $36-$38 price levels. We would remain on the sidelines for now.

Sanofi-Aventis is not recommended at this time, holding a Dividend.com DARS Rating of 3.3 out of 5 stars.